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Earnings Preview: Will BlackBerry Ltd (BBRY) Post Profit In Q3?


blackberry HQ

On December 19, BlackBerry Ltd (NASDAQ:BBRY)(TSE:BB) will report its financial numbers for the third quarter and the original inventor of smartphone seems to be on the right path to turning it around.

Expectations have started to build up after signs of improvement have surfaced as favorable data points towards increased device sales. While, the company has stated they only hope to break even on a cash flow basis by the end the current fiscal year 2015, it has also raised hope of a surprise quarter. The company’s CEO John Chen previously had stated that he hopes to return the company to non-GAAP profitability by their fiscal year 2016.

Recent Data

BlackBerry‘s Passport device reached 5.4% of BlackBerry 10 devices used in November, which was significantly higher than 4.1% recorded in October. Similarly, Z3 use has reached 4.4% in November from 2.1% in October, according to ebscer.com statistics. The data pointed out promising sales growth of these two devices launched recently.

BlackBerry’s Passport accounted for one in every 20 BlackBerry 10 phones currently indicating the growth. However, its Z10 usage among the active BlackBerry 10 users dipped below 50% for the first time to 49.8% in November.

The positive data has already made some investors as bold as to expect the company to report three million smartphone sales in the third quarter. This would mean that BlackBerry would have to report 25% growth in smartphone sales from the 2.4 million recorded in the second quarter.

Expectations

On average, Wall Street analysts’ expect BlackBerry to incur a loss of five cents a share on revenues of $959.54 million for the third quarter. In the previous year quarter, it suffered a loss of 67 cents a share on revenue of $1.19 billion.

Sequentially, Street analysts’ are predicting 4.75% growth in revenue from $916 million reported in the second quarter. It suffered an adjusted loss of only two cents a share during the second quarter. With higher sales estimated sequentially, there is the possibility that BlackBerry could surprise investors.’

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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